Unocal Says 3rd-Quarter Earnings Won’t Meet Analysts’ Projections

Unocal Corp. said Tuesday that third-quarter earnings will be sharply lower because of cheap oil and natural gas prices, storm disruptions and high exploration costs.

Earnings will fall below 10 cents per share, Unocal said, which is less than what analysts had projected. Unocal posted earnings of 71 cents per share in the third quarter of 1997 and 26 cents per share in the second quarter of 1998.

“We are confident that we will have positive earnings for the quarter, but extreme price volatility and timing of dry holes make it difficult to project an exact number,” said Roger C. Beach, chairman and chief executive of the El Segundo-based oil and gas exploration company.

First Call Corporate Monitor, which publishes Wall Street analysts’ earnings projections, had put Unocal’s earnings for the third quarter at between 10 cents and 25 cents per share, with a consensus of 19 cents per share, said Chuck Hill, director of research.

The oil industry has been suffering all year because of rock-bottom oil and natural gas prices. Third-quarter earnings for major oil companies are expected to be down 40%, after drops of 30% and 26% in the first two quarters, Hill said.

“This is one of the industries that will show the worst year-over-year earnings,” he said.

Unocal’s stock closed at $36.75, up $1.19 on the New York Stock Exchange. The announcement was made after the market closed.